The loss of LimeWire has P2P pirates on the run. (Source: Walt Disney)

But are pirates turning to YouTube and elsewhere

The NPD Group, a top market analytics research
firm has released a new study [press release]
that might surprise some. It claims that in 2010 the rate of users who
pirate content on peer-to-peer (P2P) networks dropped to 9 percent, down
drastically from 16 percent reported in 2007. This marks a dramatic
reversal of the trend ofincreasing
piracy rates in recent years.

The report argues that piracy is not a
"fundamental" problem for the media industry, given the relatively
low levels. This stands in stark contrast to statements in theDigital Media
Report 2010 [PDF] by the International Federation of the Phonographic
Industry (IFPI), the parent organization of America's RIAA. The IFPI
stated in the report, "[The industry will] struggle to survive unless we
address the fundamental problem of piracy."

Warner Music, a RIAA member takes a bit more
conservative approach. In arecent
presentation to the U.S. Federal Communications Commission, Warner
suggested that only 13 percent of Americans pirate. The Warner report
also offers some disclaimers about the harmful impact of pirates, stating that
most piratesdo
spend money on contentand that they "tend to drive high discovery for
others".

The numbers from the NPD Group are admittedly
slanted, though, due to a significant event in the industry. They were
taken from the final quarter of 2010, when theRIAA
scored a major lawsuit winthat forced the U.S.'s most popular P2P client,
LimeWire, to cease distribution. Thus the dip in P2P filesharing may be
only temporary, due to the loss of one of the highest profile clients.

States Russ Crupnick, entertainment industry
analyst for NPD, "Limewire was so popular for music file trading, and for
so long, that its closure has had a powerful and immediate effect on the number
of people downloading music files from peer-to-peer services and curtailed the
amount being swapped. In the past, we've noted that hard-core peer-to-peer
users would quickly move to other Web sites that offered illegal music file
sharing. It will be interesting to see if services like Frostwire and
Bittorrent take up the slack left by Limewire, or if peer-to-peer music
downloaders instead move on to other modes of acquiring or listening to
music."

Today, many of the most used clients are
unofficial community releases of past P2P clients that were banned by lawsuits.
Examples include Kazaa Lite and WireShare (formerly LimeWire Pirate
Edition), etc. According to the NPD Group's data, FrostWire (traditional
P2P) and uTorrent (Torrent P2P) increased in use, as well, in the wake of the
Limewire shutdown.

While the study did consider BitTorrent traffic (a
specialized P2P protocol), it did not consider new forms of illegal content
distribution, such as one-click downloads, illegally streamed content, such as
unauthorized posts to video sharing sites likeYouTube.
The latter seems particularly prevalent, as you can go toYouTubeand find
virtually any song you can imagine -- mostly from unofficial user-submitted
uploads (though the major label industry does maintain an official presence on
the site via channels like Vevo).

As has been stated before, correctly, a bajillion times, the VAST majority of stuff that is illegally downloaded on the internet would never have been paid for if it wasn't available in pirated form.

I'd not be surprised at all if the the true percentage of what amounted to "lost sales" came out at 1%...or less...of pirated content. While there most certainly are people out there who pirate stuff for the sheer desire to not pay for something they otherwise would, the vast majority of people get pirated content simply because it's there and they'll give it a shot. If it wasn't there, they wouldn't care...and they certainly wouldn't go to the store and buy it. They'd do without, or make do with something else.

This applies to all available content - music, movies, software, etc. When the morons in the content industries and/or in the government make declarations about "EIGHT HUNDRED GOOGOLZILLION DOLLARS LOST TO PIRASSY!!!!11!!one", it's utter bull$h1t. There's no basis for any such claims at all - the real "lost" revenue...the % of people who actually would have otherwise paid for the content - is actually a lot closer to zero.

as for piracy:my own books are not protected by a digital protection scheme, and here's why;- it adds cost, which my honest customers have to pay- it is NOT crack-proof, as no form of digital protection ever will be. it is a waste of money.- i write books... to copy one, one would merely have to open it and type the words into a word editor. or scan it, or wtv. i have no idea why amazon even gives you the option of opting for 'protection'- piracy is not the huge problem that content makers always make it out to be. charging more for CDs than audio tapes (even though the CD is cheaper to make), giving itunes artists only 7 cents per song and keeping the rest, quickly producing and then marketing the hell out of low-quality crap to cash in on a fad, etc etc those are problems.

for the artists, be they writers, musicians, actors, piracy is not really a huge deal. it only is a huge deal for content sellers, because they are realizing that the bottomless money well is running dry. the internet allows the producers of content to sell directly to their fans, cutting out the middleman, and the industry is scared to hell about that. so they tell their content makers that they will protect them from evil piracy if only they sign another record deal with them... this is all BS, but in a few years teh smart artists will all be selling directly to fans, not through the mafia-like industry channels.

quote: 3 Questions for Sascha von Bornheim: Q: You can take one item with you to a deserted island. What is it? SvB: A boat. Q: Why? SvB: Well, it's an island. I assume it's surrounded by water. Q: You can't get off the island. The point of the question is to find out what you'd take with you if you had to stay there permanently. SvB: A gun. Q: You would shoot yourself? SvB: Evidently. I mean, the island is deserted. Who else am I going to shoot? Rick James? Oh wait, he's already dead. Now, I didn't know him personally, but I think the cocaine might have had something to do with it. It's a hell of a drug.

I have a hard time finding content that I would bother to watch if they did give it away for free. Since nothing is any longer watchable on cable TV due to commercials being aired every 5 minutes, I only watch streaming video from Netflix and the occasional new movie from Blockbuster. Money is not even an issue for me. The issue is that many months go by before they have a new movie that I am willing to spend my time on, regardless of price.

So, it is not all about money. If all content were put online for free downloading, I think we would find that a small percent is heavily downloaded, while the vast majority are hardly bothered with. Yet, they price them all the same. If it is truly a free market, rather than a carefully controlled monopoly/trust, then why does it cost the same to purchase Avatar as it does to purchase Furry Vengeance?

I did a lot of pirating as a teenager, before I had a job or, ya know, any money. I can absolutely guarantee that I wouldn't have purchased any of that music because I couldn't afford it. And don't tell me that my mama would have given me the money, because she had to quit her job as a college professor to become a full-time, unpaid caregiver to my grandmother as her Alzheimer's progressed. When you're the sole provider for a family of three (including a teenager) and your only income is Welfare, there's not a lot of money for overpriced CDs. Thank God the RIAA didn't send her a demand for $5000 and put us on the street!

Then I grew up, got a job, and deleted my entire pirated MP3 collection from my hard drive for moral reasons. Guess how many of those songs I've paid for in the decade since then? 0! I don't pay for music because it's not worth anything to me. I only downloaded it in the first place because it was free! If it hadn't been free, I would have lived without it and just listened to the radio, like I do now.

It's just common sense that if something is worth money to you and you can afford it, you pay for it, and if it isn't worth money to you or you can't afford it, you download it for free without guilt. In either scenario, no revenue has been lost. Shut down every P2P site in the world and sales will be virtually unaffected. If I can't download it for free, I'll live without it like I did before.

I think if you check your imaginary research, you will also find that while people are willing to pay hundreds of dollars for a stereo would rather not have anything to listen to than pay for it. People who buy thousand dollar computers don't have $50 for the game they bought it for, either.

In other news, stereos in record numbers have been stolen. The thieves declare that no one was going to pay for them anyways.

The standard response to a car/piracy analogy is that the owner of the hypothetical stereo loses his stereo. No one loses a song because it is copied any more than you lose your voice when someone repeats something you've said.

Exactly. That guy up there is a classic example of the stupidity spewed by people who buy into this BS.

Getting an illicit download of a song, for example, is a copy/paste function. Nothing was "taken" from anywhere, or anyone. Which is to say, the original person who owned it still owns it...it's no more a material transaction than me standing on a park bench and reciting the Gettysburg Address. The original address is still in a museum somewhere...neither the writer nor the owner of the address has suffered anything at all.

To compare it to the theft of a physical object is utter idiocy, and is truly indicative of the wild disconnect from reality suffered by all those who put the slightest bit of trust in the $ figures claimed by the industry/government for piracy "losses."

Agreed. The car analogy is baloney, because one object is tangible and the other intangible.

You steal a car, and the car's rightful owner loses the use of that car. You clone a song and the owner still has use of the song. The only "loss" is the revenue the owner would have gained had the thief purchased the song.

My own personal impression is that some songs would have been purchased, but not very many. My guestimate would put the number at 5% of the thief's personal collection. More than zero, agreed, but not by much.

You're a classic example of the type of person who accepts the freetarded belief that a car in a lot is any different than a song. The lump of rock that it came from isn't worth all that much. You steal it, they can make another one. So, if you steal a car out of a lot, it's not really any different than stealing a song. It's not really a lost sale if no one was going to buy it, right? That's the logic used with music. It's as dumb an argument as any to justify theft.

No, it's the pirates who lack the intellect to understand what intellectual property is and the importance to civilization to maintain its protection. Perhaps this is due to being educated in what is now widely considered one of the worst schooling systems in the world, as was well documented in the movie Waiting for Superman. Luckily for you, your ruling class understands the importance of intellect and intellectual property and is actively looking for a way to make even the dumbest understand that the consequences of theft outweigh the value of the theft.

quote: I'm sure that a stolen car doesn't translate into a lost sale either.

If you wish to use a car analogy, so be it.

The difference between a pirated movie and a stolen car is simple... Nothing was stolen, just copied.It would be more attune to me stealing a copy of the cars design plans, and building the exact same vehicle for myself.

Might depend on whom the car is stolen from. If you steal from an individual, they might have to replace the vehicle, which will result in a new car sale.

But that's not what's happening here. The theft is from the dealer (or manufacturer) of the car, which means that car is then not available for sale to someone willing to spend the money. Much like a manufacturer, the "factory" can spit out another car to sell, but the loss is still felt.....and the loss of a song sale is felt as well (though I doubt it's nearly as much as the RIAA or MPAA would have anyone believe).

Frankly, I'm just amazed that anyone was using Limewire anymore. That system was full of so many viruses that you took your computer's health in your hands, every time you connected to it!!

quote: But that's not what's happening here. The theft is from the dealer (or manufacturer) of the car, which means that car is then not available for sale to someone willing to spend the money.

But that is not what's happening here. Nothing is being taken, a stream of 1's and 0's is being exactly duplicated so that it is now in the hands of two people instead of just one.

It is also highly unlikely that this would be a quantifiable loss that can be "felt" since it is highly unlikely that the second person would have purchased the song in the first place, they would have simply gone without.

The other thing that I find interesting is that it is illegal for you to sell digital content that you have purchased. Selling a used CD is perfectly legal. Copying a CD for your own personal use is perfectly legal too. But if you destroy the original CD and sell the copy, you're suddenly a criminal. That's the magic of the RIAA.

Take games purchased from Steam online. You cannot sell/transfer a game from user to user (resale) and you cannot transfer your entire account. You never actually 'buy' games on Steam. You buy a license to play that game through an account that may or may function tomorrow.

I think if you check your imaginary research, you will also find that while people are willing to pay hundreds of dollars for a stereo would rather not have anything to listen to than pay for it. People who buy thousand dollar computers don't have $50 for the game they bought it for, either.

In other news, stereos in record numbers have been stolen. The thieves declare that no one was going to pay for them anyways.

I'm really wondering how old you are. In the 80's and 90's (before downloading of music, and ripping CDs) we actually bought music. It was expensive too. I often had to decide between buying an album, or eating. And I'd usually buy the album and then have to borrow spaghetti from a room mate. It sucked to get burned on an album with only a few good songs, but you had to live with that.

Now, I don't pay for a lot of music that I probably would have. Its as simple as that. Good for me, but not good for the music industry.

Just look at music sales before and after piracy. Top selling albums routinely hit 20 million sales in the 80's and 90's. Now they never even come close to that.

I'm not a fan of the music industry, and they killed themselves but raising prices on CDs when sales started to fall. But there is no doubt Napster, and everything that came after really killed them.

I don't get pirated music, and I don't buy downloads - if I want something, I'll buy the physical CD. I don't really have much interest in having much of the music that's been produced recently. And I'm really put-off by the fact that some recent CDs I did buy had such crappy DRM on them that I couldn't easily rip them to .mp3. The solution is simple - the industry doesn't get my money.

You can pretend that the downfall of CD sales is piracy all you want. But the real reason is a combination the success of online music sales, in which CDs don't move out of the stores, and a general disinterest by the buying public, high CD prices, and a distaste for DRM.

That's the right way to protest something. Don't steal it. Don't buy it. I think your method of protest is commendable.

I'm 35. That makes me just young enough to have caught the vinyl dump craze: so many great albums for 25 cents... it's kind of sad that that will never happen again. I'm not a big fan of what's hip and haven't been for a long time. I really enjoy modern music: Sia, Zero 7, Emelie Simon, and even some commercially successful groups like The White Stripes, are really quite good.

quote: Top selling albums routinely hit 20 million sales in the 80's and 90's. Now they never even come close to that.

This was a bogus comparison before you even got to the second sentence.

On a per year basis, there were between 0-4 albums that would sell over 20 million copies. These albums made up for around 0.005% of the total number of albums each year, but accounted for anywhere up to 20% of the total album sales.

What's more, the sales were of entire albums for ~$20 usually to get 1-3 good songs. Today you can get those three songs for $1-2 each and save yourself the other $14-17. In reality, sales of entire albums have suffered more because discerning buyers will purchase only those songs they want and pan the rest of the album.

This is no longer the case and the chances that an individual artist seizes as much of the market as artists in the past are slim. This is largely because consumers are now faced with a greater and more varied selection to choose from. In the past, people would mostly buy what they heard on the radio and the record companies where the gatekeepers of what ultimately made it on the radio. Today, the gate is gone and people are swamped with choices.

I still budget around $200 a year for music and that's about what I've spent every year since 1995 when I entered high school. Back then, that would get me 8-9 albums with 16-36 songs that I actually wanted to listen to. These days, I get anywhere from 100-200 songs for the same price. None of these are counted towards albums sales despite representing 60-100 different albums.

I'm sorry, but just because consumers have been given greater choice doesn't mean we will make greater sales. Instead, those sales will be made in a more discerning fashion and dispersed across a greater number of albums, artists and ages.

In reality, we often shared our music with others. Instead of downloading off of the internet we would tape a record or copy a tape for a friend. Remember mixed tapes? Yeah, no sharing went on before Napster. :eyeroll: And it was all legal! As long as your weren't selling for profit. A friend of mine told me when he was younger that he and his buddies pooled their money to purchase an import album at their local record shop and then made copies on to tape for everyone. I don't support scum that sell others people's work. To me that is theft. But if you copy and give it away for free it should be legal.

As for the "Would you steal a car?" analogy, of course I would steal a car... if I could get away with it! Duh! But I'm not a criminal and don't like prison.

If it is your aim to say that content producers overestimate the amount of revenue lost, I would agree. If someone pirates 1 million songs, they would not have paid for them all (as another poster noted).

That said, you have a few major errors in your other comments. If we assume the "pirates" are rational people, then a few simple conclusions arise.

1) They do it because it yields a benefit as compared to the alternatives. In a world with Grooveshark, Rhapsody, Napster (legal version), Youtube, etc., it is possible to try out almost any song in existence without paying anything. These services are probably easier and more reliable to use as well. Why pirate then? Well, besides profound ignorance of the alternatives, it would allow one to try out the song out anywhere (car, mp3 player, etc.) before buying, for example. How many of these vaguely conscientious people do you think there are? (pirate to try, but ultimately buy)

2) If trying music out is not a legitimate or common reason, then they do it because they obtain something that has value to them. How can something so simple be so often overlooked? I am tired of this nonsense that people pirate stuff cuz its free. If it was truly worthless, they would not take it. They spend a lot of time searching out sources of content and then enjoying that content, and then complain that there is nothing of value to be found. Again, if people are rational, they will pirate because they recognize the value of it for them. (otherwise it is a waste of time)

3) So what would people actually buy? They take it cuz its free, but they wouldn't buy it otherwise argument... So clearly pirated content has some value or you wouldn't take it at all. However, some would claim the content is not worth the current selling price. When something is free, it is impossible to judge the actual value, since any value greater than zero will motivate piracy. Of course there is some lost revenue, and of course the "pirates" will tell you otherwise. How much, probably more than you think and less than RIAA says. Yes, some people would do without any of it if it wasn't there. But this type of person is more likely to not pirate in the first place since they are capable of being honest with themselves.

4) It just bits, not physical property. While this is technically true, the conclusions are naive, misleading, and ignorant. Music may be represented as bits, but someone who has music has something ultimately tangible. In other words, they can hear it. True, if taken, it is not like the loss of physical property. However, the revenue loss argument is valid. The only reason people can pirate at all is because most people do pay for music. If everyone believed this silly argument that taking bits is not wrong, there would be not be much music available at all. If you think most income is from concerts, then the small minority of concert goers would effectively subsidize everyone else. You think that is fair?

5) Once someone has obtained content freely, they have no incentive to buy it unless there is even more value to be obtained. If someone wants a CD because of the insert or the sound quality, then they might still buy one (a small percentage of pirates do this I would argue). On the other hand, if the pirated content has everything you want, you won't go buy the same thing, cuz that is just dumb.

6) When someone creates content like music, a book, a film, or even a news article, they are entitled to reap the benefits of that effort. This right is balanced with the benefit society obtains through "fair use." Money is not the only driving factor, in truth. If you pirate and share music, then you clearly should not have a problem reproducing on your website free content from another website. Lets suppose I published opinion articles on a blog. I made no effort to make money (i.e. no ads etc.). If you copy my article verbatim (as opposed to sending people to my blog), you can claim that you are not causing loss of revenue for me, which is true. However, you thought there was some value in the article, and that is why you copied it. Whatever it might be (even if it isn't money), I should have that benefit because I did the work of writing the original article. Artists and their representatives are entitled to reap the benefits of their efforts, and we are not allowed to take it from them because they have "enough benefit" already.

quote: 3) So what would people actually buy? They take it cuz its free, but they wouldn't buy it otherwise argument... So clearly pirated content has some value or you wouldn't take it at all.

This is only partially right. It's not just the demand side which is driving piracy, it's also the supply side. The RIAA and MPAA by being paranoid about piracy and refusing to implement a digital distribution system, have actually contributed to piracy. The success of the iTunes store, the Amazon MP3 store, and Netflix show that if the song/movie is reasonably priced, people will still buy it even if they could pirate it. If the RIAA and MPAA had embraced digital distribution when Internet use first exploded back in the 1990s, there would be less piracy than there is today. Often times, people began pirating because it was the simplest way to rip their CD or DVD collection into a portable digital format, not because they wanted stuff for free.

quote: 4) It just bits, not physical property. While this is technically true, the conclusions are naive, misleading, and ignorant.

This too is a problem of the RIAA and MPAA's own making. There are two conceptual models for paying for a product - a purchase, and a license.

In a purchase, you pay for something and it becomes yours. You can do whatever you want with it. You can sell it, you can loan it to friends, you can give it away if you want. A car is a purchase. So is a blender.

In a license, you pay for the rights to use something but it is not yours. There are certain things you can't do with it, like loan it out or sometimes even resell it after you're done using it. Computer software is typically a license. But since you're not buying the product itself, just the right to use it, there are a couple other logical extensions. If a new, updated version of the software comes out, most software companies let you upgrade at a discount. They recognize that you've already paid to license most of the features in the new version, and so let you pay a reduced amount to license only the new features. If the media the software is distributed on becomes damaged, lost, or destroyed, they will send you a new copy for the cost of the CD/DVD. You bought the rights to use the software, not the arrangement of bits on the physical CD/DVD itself.

But here again, the RIAA and MPAA have screwed themselves in their quest to extract more money from their customers. The software (music, movies) they sell isn't a purchase, and it isn't a license. It's some weird hybrid which has all the disadvantages of both for the customer, and all the advantages of both for the *AA. If a blu-ray version of a movie you have on DVD comes out, they won't give you a discount. They expect you to pay full price as if you're buying a completely new license as if you were buying a product. If you damage/destroy/lose the disc, they expect you to pay for a completely new license as if you were buying a product (except Disney - they will replace damaged discs). So it seems they think you're purchasing to own when you buy music/movies. But if you try to use the product as if you owned it - at a public performance or sometimes if you try to resell the product - they will tell you no, it's a license, so you're not allowed to do that.

So there's really no ambiguity between buying bits (a license) and buying a material goods (a purchase). The ambiguity in music and movies is entirely one of the RIAA and MPAA's own making.

quote: 5) Once someone has obtained content freely, they have no incentive to buy it unless there is even more value to be obtained.

You're assuming that price is the only factor here. It is not. There's also convenience and reliability. Downloading stuff is often inconvenient (downloads can take days), and unreliable (the source you're downloading it from can disappear before you finish). iTunes and Netflix make billions of dollars in sales despite the availability of the very same music and movies for free. They do so because their paid service is more convenient and reliable than downloading. And the price they charge for the music/movie, convenience, and reliability is worth it for most people.

quote: 6) When someone creates content like music, a book, a film, or even a news article, they are entitled to reap the benefits of that effort.

This argument is ineffective in most people's minds because of the way the RIAA and MPAA have abused content creators - contracts with demonic terms, and creative "Hollywood accounting" whose only purpose is to deprive content creators of the money they rightfully deserve.

Right now, if you're a budding musician and sign a record contract with a major label, you'll be lucky to see more than a few percent of the money from each CD sale. The *AA companies have gamed the system so that they are the beneficiaries of nearly all the revenue from sales and licensing, not the artist. In fact many musicians find themselves stuck in contracts where they produce songs which make millions of dollars for the studios, but by the studios' accounting the musician still owes money to the studio for recording expenses.

So quite often, piracy actually works in the musician's favor. People who normally wouldn't hear their music listen to it, become fans, and go to their concerts. A significant amount of the revenue from merchandise sales at concerts actually does go to the musician. And so they end up making more money from piracy, than if there were no piracy and more revenue was directed towards CD/MP3 sales.

See, the overall problem is that the music studios (and to a lesser extent the movie studios) aren't the creative force behind their industry. They're merely the distributor, yet they've gamed the system so that they get the lion's share of the revenue. Along comes the Internet which is a perfectly neutral and almost free distribution medium, and suddenly there's no need for a distributor anymore. The studios are no longer necessary, but they're fighting tooth and nail to hold on to their position of power by making progress and the natural evolution of content distribution illegal.

It's true I'm sure that many people pirate stuff they wouldn't buy, after all when it's free why not get all you can? But that obviously doesnt mean people dont also pirate stuff they otherwise would have paid for!

You should go take basic logic and reasoning classes.

Also all you have to is look at the death of PC game sales, the decline of the CD market, and the decline even of DVD/Blu Ray for more proof. Digital downloads have replaced some of the gap, but not nearly all of it.

Credentials online are like monopoly money from an atm sometimes, but I shall try to validate my claims.

I am both a security expert and a statistics scientist.

In 2000 to 2001 I studied first hand piracy at levels most would not. I went about different networks and websites and the whole shabang. What I found back then is that the estimates were off significantly from what I could find.

While a modern torrent might have so many seeds, and so many downloading at a given time, the total number of different objects being 'seeded' is actually off acknowledged scales. While in no way did I track individuals to determine numbers of persons involved (useless with some basic efforts to mask an IP, especially with dialup being the majority back then), the scale of different items and their total numbers on a given day were astonishing.

I would say that any industry estimate is significantly off kilter. I would easily say there is 100 times (or much more) traffic than even the RIAA estimates account for. While this may increase the total 'offenders' to a small percentage, the total losses become much more staggering than original estimates would conclude.

And I am sad to say that I know I did not find all 'systems' in place as I do not speak Mandarin, Russian, or any of the European languages. The scope is much larger when you account for the piracy levels know for those nations being higher than what is commonly accepted for the United States.

Just a small survey of players who at one time used a private server instead of a game companies pay servers would indicate the levels that truly happen.

Oh and as one poster stated that he had ripped music as a child, then later as an adult threw it away and purchased the music.

Please account for those who do not have moral issues later in life, please also account for inflation, interest, and on-going investments. You may have stolen only $1000 (guess) in music, and later paid that $1000, but even by normal margins, compounding interest over (guessing) 10 years means you actually cost them quite a bit. Finally inflation must be accounted for as well, but I digress with this.

The point is, for the TL;DR crowd:

There is much more piracy than estimates by most groups show. Perhaps they are handicapped by needing to prove at a minimal level of what is going on, or by their own market type (music, video, tv, games, office software, etc). There is much more piracy than RIAA estimates, and the cost is staggering.